How to maintain good customer relations while claiming payment of your invoices?

For any business, good customer relations and a positive cash flow are crucial. Therefore, finding yourself sitting on a pile of unpaid bills can seem like a dead end.

On the other hand, for your customer, a bad billing experience can damage the trust in your company. Such tension is detrimental to successful relations between the two parties, posing a threat to the entire business relationship.

So what can you do when faced with the difficult situation of choosing between maintaining the customer relationship and getting an invoice paid?

What are the reasons why customers are late in making their payments?

In the majority of cases, late payments are the result of cash flow problems with your customers. They feel something akin to shame. They fear that their cash flow problems will become public knowledge. So they stick to the ostrich policy and don't respond to reminders from their suppliers.

It's also possible that your customer doesn't want to pay because of an order or delivery dispute – bad merchandise or quality issues, for example.

If you put too much pressure on a customer to get an invoice paid, it could lead to a clash. Every business needs to collect unpaid invoices to smooth its own cash flow, but no one likes being put under pressure. Also, threatening a client with legal action is not healthy for the long-term future of a relationship.

On the other hand, playing on an emotional connection is no guarantee. Supplier and customer often know each other, which can lead the first to tacitly grant longer payment terms to the second. The customer can then take advantage of this confidence to favor the payment of other suppliers.
Some customers switch providers as soon as they feel unappreciated, find company representatives unhelpful, or experience other service-related issues.

The lack of communication between customer and supplier is at the root of tensions around payments and unpaid invoices.

How to raise unpaid invoices and send your reminders?

First, it is essential to invoice as soon as possible and to ensure that your customer receives your invoices. Check the accuracy of your invoices as well as the contact details of your customers. Keep in your files all signed documents, receipts, validations, etc. This can always be useful to you later.

Regularly check the due dates of your invoices. For some customers that you know are regularly late, send a quick text or email as the due date approaches, rather than waiting for them to be late as well. On the due date, if you still haven't received your payment, send a simple and courteous reminder to your customer.

If you have granted a payment deadline or a settlement plan, make sure that your customers/debtors respect their commitment. Otherwise, send them a payment reminder without delay.

In your reminder letter, be sure to include the following:

• contact details of both companies
• date of your callback
• billing contact person in your company
• information on the invoice due (number, detail, possible copy)
• amount due (principal and any costs, to be justified with your general conditions)
• reminder of your payment conditions and the consequences in the event of delay
• reminder due date and payment reference

There are automation or IT solutions for tracking your invoices, payments and reminders. The free MindYourBills app, for example, allows you to easily enter your invoices in the app, notifies you when an invoice is due, offers you an automated reminder and follow-up in the event of unpaid bills.

If invoices remain unpaid after your reminders, turn to an intermediary. The intermediary has no emotional ties. As its name suggests, it sits between the two speakers. It helps you recover your due while considering the debtor as his client's client. He listens to your client and must show openness to find an amicable solution as quickly as possible. Amicable negotiation is always preferable to recover your unpaid invoices while maintaining a commercial relationship.

The ability to listen and build trust facilitate dialogue with your late payment customer. Collection companies have every interest in finding payment solutions while maintaining the customer relationship and your brand image.

There is no magic formula for negotiating the perfect payment terms. Behind the technical and financial aspects of negotiating payment terms lies a business strategy. You must maintain a good customer relationship and ease tensions to prevent late payments from turning into non-payments. But when you are still not paid when your reminder is due, it is time to entrust the negotiation of your due to a trusted intermediary, such as INTERNATIONAL RECOVER COMPANY® .